Comments on: Freelancer’s Survival Guide: Employees Part One

By: Kris

Kris — Thu, 03 Sep 2009 03:49:21 +0000

Excellent point, Doug. Thanks.

By: Doug K

Doug K — Thu, 03 Sep 2009 03:24:30 +0000

One of the interesting things you learn when hiring your first employee is how the Unemployment Compensation system works. The first thing you learn is that it is a tax on employers, not a government welfare program. Ultimately, all unemployment benefits come out of the employers’ pockets, not from any general tax revenue collected and allocated by state government. So, if you lay off or fire an employee (other than for very narrowly defined just cause), you pay the unemployment compensation that the employee draws.

The second most interesting thing you learn – and it is the most important to you – is that you, as a self employed person, do not qualify for Unemployment Compensation at all. As the risk taker, the fabled engine of American economic growth by being a small business employer, you are completely cut off from the safety net.

The bottom line? Employee unemployment welfare isn’t welfare at all and you don’t qualify. Save, save, save, because you’re the only safety net you’ll have.

By: Mark Terry

Mark Terry — Thu, 30 Jul 2009 20:06:58 +0000

I was having lunch with a friend of mine who runs his own business, a media research company with 5 or 6 employees. I’m a freelance writer, editor, novelist and now publisher with zero employees (and I’d like to keep it that way). He commented that “most employees don’t understand where the money comes from.”

But you as the employer do. And that can be a headache.

He also once mentioned that part of the current hassle of hiring is dealing not just with the IRS, but with the INS (immigration) to make sure all employees are legal citizens, etc. Hell, hire an accountant. You’re going to have to if you have employees.